The Indian government is considering a new pension scheme for gig workers that will require platform aggregators to contribute 2% of gig workers’ income toward a pension fund, according to a report by Business Standard. The scheme is expected to be announced within the next 2-3 weeks as per the reports. The move aligns with the government’s aim to provide better social security for gig and platform workers.
The aggregators include the likes of Uber, Ola, Swiggy, Zomato, Blinkit, Zepto and Porter among others that employ gig workers such as delivery partners.
This collection of 2% of each of the gig workers’ earnings from platform aggregators toward their pension fund will be implemented as part of the pension scheme proposed by the Labour Ministry in February 2025. The Labour ministry had announced in February 2025 its plans to ‘extend formal recognition and social security benefits’ to gig workers.
The government in Union Budget 2025 also said that the gig workers will be provided with identity cards, e-Shram registrations and healthcare security under PM Jan Arogya yojana. The gig workers will have to register on the e-Shram portal and declare the platforms they work with. The UAN under EPFO will be assigned to the gig workers after verification.
How will it work?
- The platform aggregators will be required to contribute 2% of the earnings of gig workers per transaction to a pension fund managed by the Employees’ Provident Fund Organisation (EPFO).
- This 2% contribution will be made by the platform aggregators and will not be deducted from the gig workers’ income. Normally, EPFO contributions consist of contributions both from employees and employers, but here the proposal is different.
- Each gig worker will be allotted a Universal Account Number (UAN) by EPFO to track their pension funds.
- Under this pension scheme, if a gig worker working with a platform earns Rs 20 on every transaction performed, the employer will deposit 2% of this amount (40 paisa) under the UAN with EPFO. On a larger scale, if a gig worker earns Rs 1 lakh in a year from one or more platforms, their total pension contribution would be Rs 2,000 per year.
For years, the gig workers have raised concerns about job insecurity, lack of benefits, financial instability and poor working conditions. And unlike salaries employees, gig workers do not get benefits such as pensions or provident funds. Although the Code on Social Security, 2020, recognises the gig workers as a separate category, they are not fully covered under the traditional labour laws.
The implementation of the proposed pension plan addresses some of these concerns and marks an step toward recognising the gig works as an important part of the economy.
India currently has over 1 crore gig workers employed with the platforms aggregators and that number is bound to grow to 2.35 crore by 2029-30 according to a report by NITI Aayog. Reportedly, 11 aggregators have stated to the officials that 35 lakh gig workers have worked with them for the past 90 days.